In one of my previous articles, I looked at why you can’t wing it in business forever, and the importance of structures.
My experience of many early-stage entrepreneurs though, especially those in the construction sector, is that many of the structures aren’t in place because there’s simply too much to do each day.
That’s why one of the first things I recommend you do is work out what you’re amazing at, and also what you don’t want to do so much of
One of the elements that needs the most structure in your business, is your quoting, pricing, and (if you offer any) discounts or deals.
I’ve learned this the hard way on a number of projects. In this article I’m going to highlight what you can learn from one of the expensive mistakes I made, so that you can avoid the same thing happening to you.
Feeling the need to price competitively
You might have read my previous piece, where I mentioned about the extension project we took on with a very short deadline.
The couple had received a number of quotes from different companies, but it was getting late, and nobody could book in the work and guarantee it would be completed when the baby was due.
To get the work, we had to price competitively, but I liked the family and I wanted to deliver the project so they could enjoy it when the baby arrived.
The situation reminded me of my own family too. The husband’s mum had left him the house, and it wasn’t in a great state, and just like when my auntie passed away- when I looked after my cousins- he had looked after his sister when their mum had passed away.
I really empathised with this couple, and I just wanted to help them.
Structures stop you from missing things
The project ended up being worth a significant amount of money to my business, and I did make a profit on it, but it was the first real job I had priced up myself.
There were things missing from the quote, that we ended up including for the same fee, and it was probably a lot cheaper than they were expecting because of the things I missed from the original quote.
If I’m honest too, my feelings toward the couple might have impacted my focus when we were putting our quote together.
What can we learn?
Looking back over the last 20 years, especially thinking about my construction business, I’d estimate that I’ve lost thousands, possibly tens of thousands, of pounds because I didn’t have someone in my corner to learn from.
When you think of the revenue from one extension project for example, it could easily be tens of thousands each time.
- Structures for your quotes:
One of the things I work with my clients on, is having a structure in place for their quotes, so that they know what to look out for, and what might be missed.
If you know the different phases of your projects, and can identify what work needs to be done and when, it can help you avoid missing anything.
- Stick to your rates:
I find that many early-stage entrepreneurs, particularly those in the construction industry, don’t have structures in place for their pricing.
That means that when they’re asked for discounts- by family, friends or anyone else- they end up with lots of different prices.
One thing I learned from the extension project was that empathy and emotion can have an impact on you, so having structures in place helps you to stay focused.
So, have the price that you work for, and have a family and friends rate, but those are the only two rates you should have if you want to avoid complications or arguments. When you start doing different deals, you can get into a never-ending conversation.
- Get everything down in writing:
With fees, especially when it comes to construction, I’ve found that you can easily get into a ‘you said’ argument. I’ve learned to be very clear from the start, and that getting everything down in writing is so important.
It might sound extreme, but a contact of mine even does this with his wife. She’s a well-known speaker in her industry, and her husband books a lot of her speaking gigs, but they have a contract between them.
He told me that they did it to avoid arguments in their business, but obviously you can imagine it helps avoid issues in their relationship too.
I’ve learned a lot during my 20 years in business. A lot of the learnings hit me in my pocket financially, but more importantly, all the stress definitely combined together to cause my breakdown.
I often look back now and think “if only I’d had someone to support me. Someone to learn from.”
That’s why I now work with entrepreneurs who are, in many ways, similar to me in the early days.
And that’s why I’m on a mission to help early-stage entrepreneurs, particularly in construction, avoid the mistakes I’ve made, and turn their trade into a business.
If you’d like to find out how I could help you, please click here to book a discovery call.
